Hydrogen has been gaining more and more traction recently with established energy companies, old and new car manufacturers, as well as the general public, all looking to explore the possibilities it offers. One particular hydrogen technology is becoming popular by the minute. Hydrogen fuel cells have attracted increased attention not only by companies but also from investors. So in this article we’ll cover everything about hydrogen fuel cells – from their components and how hydrogen fuel cells work, through the benefits and challenges they pose as well as the future prospects for the market and the companies involved in it.
What Is A Hydrogen Fuel Cell?
A fuel cell is a technology that uses either hydrogen or another fuel to produce electricity. Fuel cells are unique because they can be used in a variety of applications. They can provide power for systems as large as a utility power station and as small as a laptop computer.
Hydrogen fuel cells are an electrochemical power generator that combines hydrogen and oxygen to produce clean electricity. They can power pretty much anything – trucks, cars, delivery vans, drones, airplanes, commercial, industrial, residential buildings and even futuristic technologies like air taxis.
The only by-products of the electricity generated would be water and a bit of heat. Since hydrogen fuel cells emit only water, there are no CO2 emissions and no air pollutants at the point of operation. Therefore, they are considered a sustainable and green source of energy generation.
How Does A Hydrogen Fuel Cell Work?
To turn hydrogen and oxygen into electricity, hydrogen fuel cells need three components – a negative electrode or anode, a positive electrode or cathode and an electrolyte membrane. Hydrogen is fed at the anode, and oxygen at the cathode.
Platinum is most often used as part of the anode catalyst. The catalyst separates the hydrogen molecule into protons (H+) and electrons (e-). Then, they take different paths to the cathode.
The electrons go through an external circuit, creating a flow of electricity. The protons move to the cathode, where they unite with oxygen and the electrons to produce the water molecule and a small amount of heat.
When it comes to comparing hydrogen fuel cells pros and cons, it seems the former considerably outweigh the latter. Hydrogen fuel cell technology is considered to provide substantial benefits in comparison to other sources of energy. It is an energy efficient and environmentally friendly solution to the world’s growing energy needs.
Hydrogen is the most abundant element in the world. It takes three quarters of the universe’s matter and approximately 90% of all atoms. It can also be produced using a wide variety of technologies including electrolysis of water, steam reforming of natural gas, coal gasification, thermochemical production, and biological gasification.
With so many ways to produce hydrogen, it offers room for improvement in terms of hydrogen fuel cell efficiency and cost-effectiveness, while also reducing the dependency on oil and other fossil fuels. Hydrogen also doesn’t require large areas of land to be produced unlike biofuels, hydropower or other sources of renewable energy.
Zero Emissions Impact
One of the biggest advantages of hydrogen fuel cells is their zero emissions impact. They produce just water and heat during operation with no harmful pollution like CO2 or particulate matter. They provide just inherently clean energy with no externalities that can negatively impact public health or the environment.
NASA has been working on using hydrogen as a source of water production used as drinking water by astronauts. That proves hydrogen fuel cells are a non-toxic fuel source and thus superior compared to coal, natural gas and nuclear power.
In terms of storage, stored hydrogen will never dissipate until it is used compared to other energy storage types like batteries and capacitors. They lose the energy stored in them over time and need to be periodically recharged even without use. That advantage of hydrogen makes the fuel cell technology appropriate for powering emergency generators and other mission-critical energy applications.
Since hydrogen has a wide availability of production and storage, it can be a better alternative for heating and power than diesel in remote areas. It offers a non-polluting fuel that can be easily obtained from a readily available natural resource that is everywhere. It also reduces the need to transport fuels across borders.
That makes it capable to lower the dependency of a nation on fossil fuels. As the struggle over fossil fuels energy resources has been a leading factor in many conflicts and wars around the world, the hydrogen fuel cells technology has the potential to democratise energy and bring equilibrium in power supplies around the world.
Hydrogen Fuel Cell Cars
Hydrogen has the highest energy density of any common fuel by weight. Diesel has an energy density of 45.5 megajoules per kilogram (MJ/kg), gasoline – 45.8 MJ/kg and hydrogen has an energy density of approximately 120 MJ/kg – three times more than diesel or gasoline. That means hydrogen fuel cells will need 1 kg of hydrogen to power an electric motor while a combustion engine needs a gallon of diesel to produce the same energy.
Hydrogen fuel cells excel in internal combustion engine technology in terms of efficiency as well. Currently, most internal combustion engines operate with 25% rate of efficiency and power plants achieve around a 35%. Hydrogen fuel cells can convert the chemical energy in the fuel to electrical energy with an efficiency of up to 60%. When used in vehicles, hydrogen fuel cells are 40-60% efficient while also offering a 50% cut in fuel consumption.
When used in cars, hydrogen fuel cells have one of the fastest fuel charging times – similar to conventional internal combustion engine vehicles. While electric vehicles require between 30 minutes and several hours to charge, hydrogen fuel cells take under five minutes.
A hydrogen car also has a longer driving range than an electric car of more than 300 miles to meet consumer needs. It is also not significantly impacted by the temperatures outside as it doesn’t deteriorate in cold weather like EVs.
The hydrogen fuel cells are also popular in a growing niche of transport segments. In some locations, the technology is preferred in commercial applications where hydrogen fuel cell trucks need to travel long distances, carry heavy loads and refuel with minimal downtime.
Because of its wide availability for a variety of uses, hydrogen fuel cell technology has been tested on everything from public buses and forklifts to trains, airplanes and boats. In comparison, for use in larger crafts, electric batteries would need to be much larger which could be problematic.
Disadvantages Of Hydrogen Fuel Cells
Even though hydrogen fuel cells do not emit any harmful gases during operation, the production of hydrogen has an emissions impact. Nearly 98% of the hydrogen in the world today is produced from natural gas with CO2 as a by-product.
The process is called reforming and even though it is expensive, it is still cheaper than other methods of production. Currently, the hydrogen sector produces 830 million metric tons of CO2 emissions each year which means it is not green.
The only emissions free way of isolating hydrogen is through electrolysis using renewable energy to separate the hydrogen from the water molecule. Another setback for hydrogen fuel cell technology is that during the production of hydrogen, it takes as much energy as the energy it produces after.
Another important concern is safety. Hydrogen is highly flammable and its transportation for use at refueling stations poses additional safety risks. However, no serious incidents have been reported about the hydrogen stations in California where the industrial sector has been transporting it for decades.
There are issues regarding transportation and storage as well. Hydrogen can be stored as either gas in high-pressure tanks or as a liquid. Both methods involve an inherent loss of energy. Around 13% of the total energy is lost when compressing the gas, and when liquefied it loses about 40%.
The fuel cell efficiency could also be an issue when compared to EVs. They are more energy-efficient than internal combustion engines but less than lithium-ion batteries. At its highest, hydrogen fuel cell energy efficiency is around 60% and lithium-ion batteries have one of the highest CE ratings at 99%, while lead-acid batteries are around 90%.
The biggest challenge of all however is cost. To be competitive in the marketplace, the cost of fuel cells will have to decrease considerably without compromising performance. In batteries, most of the cost comes from the raw materials used to make it.
With hydrogen fuel cells, the most expensive part is manufacturing the fuel cell stack itself – not the materials it requires to make it. The cost to build and maintain hydrogen stations also needs to come down for the market to be able to sustain a hydrogen economy.
Right now the adoption of is hindered by the scarcity of infrastructure. Large scale utilization of hydrogen fuel cell technology for vehicles would require new refueling infrastructure to support it.
The current infrastructure of natural gas pipelines can not be used for the distribution of pure hydrogen, as it makes steel pipes and welds brittle, which causes cracks. There is a massive need for investments in both hydrogen fuel stations and production of the fuel itself. In addition, renewable power projects are required as well to supply carbon free hydrogen fuel.
The overall high production costs of electrolysis, storage and transport because of the lack of developed infrastructure, make the cost for a unit of power from hydrogen fuel cells currently higher than other energy sources, including solar panels.
This is expected to change but right now the higher cost is a barrier to the use of hydrogen even though it is more efficient once produced. This expense spreads further down the line to the price of hydrogen-operated vehicles which makes their widespread adoption also unlikely at the moment.
Global Adoption Of Hydrogen Fuel Cell Technology
As with any new technology, the fuel cells market is expected to grow and achieve economies of scale in manufacturing and infrastructure as costs come down. However, automakers agree the economies of scale cannot be achieved without infrastructure.
The hydrogen fuel cell technology is witnessing an acceleration in recent years due to the increase in hydrogen fueling stations. According to a study called Global Market for Hydrogen Fueling Stations 2021, released by Information Trends, 584 hydrogen stations were deployed by the end of 2020. That is a 35% increase compared to the year-end of 2019.
The number of countries that are using hydrogen stations now stands at 33 with Japan a clear global leader with nearly 150 hydrogen stations. The deployment of the technology by companies like Hyundai, Toyota, and Honda is also a positive sign for the uptake of hydrogen fuel cell vehicles.
Market For Hydrogen Fuel Cell Companies?
Toyota, the world’s second-largest automaker, is the biggest player in the US consumer market for hydrogen fuel cell vehicles. Its Mirai launched in 2015 – a hydrogen fuel cell family car that has made over 11,000 sales worldwide. The company wants to increase production of the model from 3,000 units per year to 30,000 cars by 2021.
Honda also committed to the hydrogen technology. There are more than 1,100 Honda Clarity Fuel Cell vehicles on the road in the US.
Japan is notably leading the way in hydrogen fuel cells technology adoption. The government has set an ambitious target of having 200,000 hydrogen fuel cell vehicles (FCVs) on the road by 2025, compared to just 3,600 in 2019. South Korean company Hyundai Motor Co. has also entered the market, supported by its own government’s plans to produce 6.2 million FCVs and build at least 1,200 refilling stations by 2040.
China has also put hydrogen technology on the map by developing hydrogen-powered heavy-duty trucks. The government launched in November 2020 a 15-year plan to develop its fuel-cell supply chain. It aims to have 1 million FCVs in operation by 2030.
In the US, California is also committed to the effort of scaling hydrogen fuel cells by planning 200 hydrogen stations by 2025.
A KPMG 2017 survey of 1,000 senior auto executives shows 78% of them believe hydrogen fuel cells have a better long-term future compared to electric cars and will represent “the real breakthrough”.
The short refueling time of just a few minutes is pointed out as a major advantage. 62% claim that infrastructure challenges will result in the undoing of the battery-powered electric vehicle market.
However, a popular belief is that the battery and hydrogen debate is not an either-or proposition. It will be hard for countries to achieve their net zero pledges by 2050 without the deployment of hydrogen-powered vehicles.
With the projections for the cost of hydrogen to be falling worldwide due to improvements in water electrolysis and technology, the deployment would become easier for countries. The Paris-based International Energy Agency forecasts the cost of producing hydrogen to drop by 30% by 2030.
The rapid reduction in the cost of recent photovoltaic solar energy projects in the Middle East could also mean that the local price of commercially produced hydrogen can fall even faster.
Hydrogen Fuel Cell Stocks
Hydrogen fuel cell stocks have also been gaining investors’ attention recently. They will likely see even bigger demand in the future as the world is transitioning to low carbon technologies in aviation, trucking, shipping, utility, and pretty much every energy and transport sector.
The New York-based Plug Power (NASDAQ:PLUG) is one of the biggest players in the hydrogen fuel cell industry. The company produces hydrogen fuel cell systems for cars, forklifts and is expanding into devices for data centers and robotics. Its shares have seen a phenomenal rally over the last 12 months, gaining a whopping 543% in value. It’s not a cheap stock as it is trading 11 times its book value but future growth projections are positive.
Bloom Energy (NYSE: BE), FuelCell Energy Inc (NASDAQ: FCEL), Nikola Corporation (NASDAQ: NKLA) and Ballard Power Systems Inc (NASDAQ: BLDP) are considered some of the best hydrogen fuel cell stocks for 2021 to hold. Since they currently produce negative revenue, investors will be looking for clues on when those companies break even. That would likely fuel the stocks and attract investments into the company.
With the increase in hydrogen infrastructure and net costs falling, the hydrogen economy could prove to be an indispensable tool in the transition towards sustainable energy sources. Decreasing the cost of hydrogen fuel cell vehicles is also a key to market penetration and will accelerate substantially consumer adoption.
One of the biggest sellers of the technology is sustainability and zero emissions generation during operation. It can turn into the best solution for the future of our growing green energy requirements, especially when economies of scale are achieved and costs have come down over the next few decades.